SNS - what a difference an external auditor makes !

So, banks balance sheets are often said to be opaque. In the Dutch ministry of finance's discussion of its decision to nationalize SNS Reaal I came across the following (translation of text in bold at bottom below).

The takeaway is that SNS had written down EUR700 million of a EUR9 billion property loans portfolio, but (quietly?) expected to take additional losses of EUR1.4 billion.

But an external auditor said the *base case* was actually additional writedowns of EUR2.7 billion.

That means starting from a loan portfolio worth EUR8.3 billion, SNS and the auditors had a difference of opinion of EUR1.3 billion as to its actual worth.

If I'm reading right, SNS hadn't taken at least EUR1.4 billion in write-downs it KNEW it should have and in the external auditor's opinion EUR2.7 billion _ ie. in the auditor's opinion, SNS should have been writing down about A THIRD of the value of this loan portfolio.

That's not even the worst case scenario.

That's my interpretation of the below. Implications for other European banks with real estate loans?

Page 4 (bullet point 14), my translation:

SNS Property Finance itself estimated the losses it expected on the basis of the information that was available as of the middle of 2012. The Real Estate Portfolio then had a net size of about EUR8.3 billion (gross size of about EUR9.0 billion minus EUR0.7 billion provisions). SNS Property Finance estimated these additional expected losses in a base scenario would amount to about EUR1.4 billion, and in a negative scenario about EUR2.1 billion. The ministry hired Cushman & Wakefield in October 2012 to make an independent valuation of the real estate portfolio of SNS Property Finance. The result of the measurement of the actual economic value on the basis of information available from mid 2012 _ the correctness of which the Ministry then presumed afterward _ was for the real estate loans [to be worth] around EUR5.6 billion in a base scenario and EUR4.9 billion in a negative scenario.
In addition, Cushman & Wakefield indicated that SNS Property Finance's real estate [i.e. actual property, not loans] has a current actual economic worth of between EUR185 million and EUR265 million.
All this can be translated into an expected loss beyond the provisions taken by SNS Property Finance on its real estate loan portfolio of between EUR2.4 billion in a base scenario and about EUR3.2 billion in a negative scenario. These losses are substantially higher than the additional expectable losses estimated by SNS Property Finance. A recently updated overview by Cushman & Wakefield doesn't materially change the picture.

Link to actual report:
http://www.rijksoverheid.nl/bestanden/documenten-en-publicaties/besluiten/2013/02/01/onteigeningsbesluit-sns-reaal-en-sns-bank/fm-2013-213-onteigeningsbesluit-sns-reaal-en-sns-bank.pdf